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Crowdfunding: How Indiegogo Connects Concepts With Cash

Big Idea: A crowdfunding platform that also helps users amplify their project through a special "gogofactor." The more traction a campaign gains, the more eyes will see it.

Why It's Working: Indiegogo relies on "user democracy" — anybody can raise money for anything, and the power of the funders help dictate what catches fire and ends up on the website's homepage. The result is that those looking for funding can reach new audiences to help get their work realized.

Those who have ever sought funding for a project know that riding the wave of the Internet crowdfunding movement isn't as easy as it looks. Although legislation such as the JOBS Act is opening the doors for extensive, online peer-funding, just finding peers who are willing to give up their hard-earned cash for your project can be a huge hassle.

That's where crowdfunding site Indiegogo seeks to separate itself from other crowdfunding platforms. Founder and CEO Slava Rubin says that Indiegogo operates on a democratic platform. Users can seek funding for any project they want, from a cause to a campaign to a project. In turn, Indiegogo will help get the word out about projects that have been submitted to the website to visitors who are unfamiliar with them — Indiegogo effectively increases your chances for crowdfunding by pulling a funding-happy crowd together.

"We help you get more money than you ever could on your own," Rubin explains. "First, by making sure the experience is as good as possible on Indiegogo, and then helping to amplify it out to more people than you ever could."

Indiegogo has now nailed the amplification levels down to a science, thanks to the company's custom-built algorithm called "gogofactor." Rubin says that this algorithm can track how much a campaign is gaining traction within the website based on factors such as the funding rate, the number of updates and the number of comments. These popular campaigns have a greater likelihood of reaching the Indiegogo homepage and, as a result, have a greater opportunity of getting complete strangers to fund a project. Rubin explains that this is a much more sophisticated technique than the company's original tactic when it began in 2008.

"At first things were manual where people would ask, 'Can I be on the homepage?'" Rubin explains. "We really believe in what Google did, which is to create algorithms to determine how active something should be. We use that to promote all across Indiegogo."

And Rubin says that the level of attention is equalized across all campaigns; small groups looking to raise a nominal amount (like $500 or $1,000) could have just as high of a gogofactor as large groups seeking $100,000 in funding. This means that small projects have just as good of a chance of reaching the homepage as large-scale organizations — it's Indiegogo's way of looking out for the little guy. And that is huge, especially given the fact that the company distributes millions of dollars globally every month.

"The way we think about the gogofactor and Indiegogo is that it's like America: equal opportunity, but not equal results guaranteed," Rubin says.

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